Fiscal Year Financial Report
Un-Audited Fiscal Year July 1, 2024, to June 30, 2025
Administrative Services 8/21/25 Q4 2024/25
Fiscal Year End Report
Fiscal Year 2024/25
FISCAL YEAR FINANCIAL REPORT | PAGE 1 of 7
Introduction This financial report provides an overview of where we are within the budget cycle, then a summary of the City’s financial position through the Fiscal Year (FY) 2024/25 (July 1, 2024, through June 30, 2025) for (1) Citywide Revenues and Expenses, (2) the General Fund, (3) Enterprise Funds, and (4) Summary of Cash and Investments. Notable cumulative year-end to year-end and preliminary amended budget to actual comparisons are included in this report.
The following factors should be taken into consideration when analyzing year-end data:
∗ Revenues reported herein are calculated based on actual receipts through June 30, 2025, but received through August 15, 2025. Some revenues for the Fiscal year are still being received and will be properly accrued for the audited financial statements. ∗ Construction projects, specifically street improvements, have a different project cycle which is offset from the Fiscal Year. As such, major projects are typically funded across two or more Fiscal Years.
Standard Budget Process Cycle - Where We Are Now & Next Steps:
Tentative Schedule for Financial Reporting:
∗ September 2nd – Start of 2024/25 Fiscal Year end audit fieldwork. ∗ October 28th – Present the Q1 2025/26 financial summary to Council. ∗ November 12th – Present audited financial statements and community annual financial report to the Council for Fiscal Year 2024/25
February
Year-end & Financial
Performance Review
March
Year-end & Financial
Performance Review
Internal Budget Review,
Strategic/Long-Term and
Capital Planning
April - May
Draft Budget
Budget Workshops
June
Budget Adoption
NOW** July - December
Financial Evaluations
Budget Adjustments as
Approved by Council
November-December
City Manager and Admin.
Services Budget
Planning Meetings
FISCAL YEAR FINANCIAL REPORT | PAGE 2 of 7
Citywide Revenues and Expenses
∗ Other Special Revenues consist of the following funds: Gas Tax, RMRA, Public Safety, K-9 Program, Traffic Mitigation, CDBG Grants, Inclusionary Housing, Linkage Affordable Housing, MTC Streets, Measure M Parks, PEG, In-Lieu Tree Fund, and Bed Tax.
City-wide Significant Variances
Fund type variances where revenues were less than 95 % or expenditures are greater than 95% of budget as of year-end were evaluated as follows:
• Capital Projects’ revenues are currently less than the budget due to the timing of the projects in place and pending transfers from other funds to cover expenditure as of the fiscal year end. • Internal Services Funds had lower revenues and expenditures than budgeted primarily due to the pending year end closing entries and transfers of funds for compensated absences as well as accounting for depreciation expense within the vehicle replacement fund. • Wastewater Fund has higher than 95% in expenditures as of the fiscal year end primarily due to the full accounting of 100% of the expense and budget for Wastewater treatment at $2.5M and approximately 60% of the total budget for the combined Wastewater funds.
Overall actual revenues and expenditures for all funds are anticipated to be aligned with the adopted budget, with the proposed adjustments, for the fiscal year ending June 30, 2025.
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General Fund: Operating Revenues
The following table includes cumulative revenue comparisons of Fiscal Year 2022/23 and Fiscal Year 2023/24, and revenue budget to actual comparison for Fiscal Year 2023/24.
General Fund operating current revenues are $257,124, or 2.2% below the same period in FY 2023/24.
The most significant reason for these decreases was primarily due to the decreased Transfers In, Sales Taxes, Charges for Services and Investment Earnings, offset by increases in Property Tax and Other Taxes and Other Revenues. There are additional accrued payments still pending receipt and will be properly accrued for using the modified cash basis of accounting. To properly depict the revenue for sales tax the City has included the known final payment of $512K in Sales Tax receipts expected to be received by August 26, 2025.
The following is an explanation of the notable variances:
- Sales Tax revenues are approximately 1.3% or $75K less than last year’s cumulative year-end balance. This change is primarily due to reduced spending on Cotati goods and services as more consumers in the prior calendar year moved to spend more on experiences postponed during Covid and in 2025 were adjusting spending due to economic uncertainty. Industries that improved during the Covid Crisis included Home Improvement, Service Stations, Liquor Stores, and General Food and Drug. These industries are seeing corrections to more normal functions. - Licenses Permits and Franchises are primarily reduced due to pending Q4 receipts or accrual adjusting entries for franchise agreements for both Cable TV and Gas. - Charges for Services decreased by 15.8% or $78K due to a combination of (1) reduced dollar value and number of permits need of engineering plan checks for development projects, (2) reduced development project cost reimbursement.
- Investment Earnings have decreased due to decreased interest earnings in the prior year we had a weighted Yield to Maturity of 4.55% and as of June 03, 2025, the same rate has declined to 4.21%.
Additionally, as the City continues to utilize general fund balances towards capital work, the fund balance has decreased and the proportionate allocation of the interest earnings across all funds has decreased.
- Transfers-In are decreased due to prior years one time transferred back to the general fund for one time grant project reimbursements for the REAP grant and close out of the excess bond proceeds fund back to the General Fund.
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General Fund: Operating Expenditures
The following table includes cumulative actual expenditure comparisons by department and again by expenditure type for Fiscal Year 2023/24 and Fiscal Year 2024/25 and an expenditure budget to actual comparison for Fiscal Year 2024/25.
Expenditures by Type
Expenditures by Department
Evaluating the expenditures, overall spending by General Fund Departments have decreased in both the Police Department and Community Development Department these decreases were due to decreased contract services for one-time special projects for each department. These decreases were offset by increases in City Managers Department and City Council which increased due to one-time contract services for each department, and the Public Works Department which had increased salaries and benefits due to staffing demands for field crew and the Interim PW Supervisor. See below for details based on the Costs for all other departments were primarily driven by the following:
- Salaries & Benefits have increased over the last year primarily related to negotiated MOU increases as well as increased one-time staffing coverage for the Interim Public Works Superintendent. - Contract Services, including Legal and Insurance, have increased due to continued insurance costs for the City’s general liability and workers comp. insurance premiums. Additionally, the City Manager’s office includes the legal costs pertaining to the mobile home park litigation and the City Council department had a contract for the facilitated strategic planning meeting. - Utilities have increased primarily due to increased rates for electric charges from PG&E as well as some increased water consumption with establishment of new landscaping in the parks along with increased rates.
Reviewing the costs comparison to budget for the General Fund, by department and by type, most expenditures are aligned with expectations.
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Enterprise Funds: Operating and Capital Revenues and Expenses The following table includes cumulative revenue and expenses comparisons of Fiscal Year 2023/24 and Fiscal Year 2024/25, and a revenue budget to actual comparison for Fiscal Year 2024/25 for the Enterprise Funds.
The Water and Wastewater Fund revenues are made up of charges for services, connection fees other revenues, and development fees. The revenues for the Water Funds have increased in the current year to increase in consumption and rates as well as increased investment earnings. This is consistent with the Wastewater fund, which also has an increase in revenue due to increased consumption and rates as well as increased investment earnings. Total revenues for Water and Wastewater funds increased $392K or
16.2% and $122K or 3.5% respectively over the prior year.
For Fiscal Year 2024/25, most of the expenses are in line with the budget at year-end. Significant differences between fiscal years are primarily related to Aqueduct Water Purchases, Wastewater Treatment, Salaries & Benefits, and Contract Services which include Legal and Insurance. During fiscal year 2024/25 the City completed the Scada System Hardware Resiliency Project, some Well 1A improvements.
FISCAL YEAR FINANCIAL REPORT | PAGE 6 of 7
Cash and Investments
The tables below show the cash and investments held by the City as of June 30, 2025. The current cash and investment balances are in line with the City adopted investment policy and as budgeted are enough to meet the City’s expenditure requirements for the next six months.
OPERATING CASH,
$999,089 , 6%
LAIF, $6,508 , 0%
US BANK, $6,167,760 ,
34%
CAMP, $10,661,481 , 59%
SCIP, $203,654 , 1%
Investment Portfolio Composition - $18.0 Million
Gen. Operating, $4,083,430
Special Revenues, $3,294,534
Successor Agency, $1,901,208
Water Operating and Capital,
$4,049,812
Wastewater Operating and
Capital, $2,583,981
Capital Projects Internal Service Funds, $633,481 , $1,493,116 Deposit Accounts, $(2,033) Cash and Investment Value By Funds - $18.0 Million
FISCAL YEAR FINANCIAL REPORT | PAGE 7 of 7
Cash and Investment Detail by Composition
Conclusion
Except for identified variances, expenditures and revenues are mostly in line with budget. Continued budgetary strategic planning for future years along with capital project planning will continue to improve the City’s position going forward. Staff will provide the Council and community financial reporting for the Fiscal Year 2024/25 annual audited financial statements as well as Fiscal Year 2025/26 quarterly budget-to-actual reports.